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EMCOR Group, Inc. (NYSE:EME)
Beneish M-Score
-2.59 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

EMCOR Group, Inc. has a M-score of -2.59 suggests that the company is not a manipulator.

EME' s 10-Year Beneish M-Score Range
Min: -3.12   Max: -0.93
Current: -2.59

-3.12
-0.93

During the past 13 years, the highest Beneish M-Score of EMCOR Group, Inc. was -0.93. The lowest was -3.12. And the median was -2.46.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of EMCOR Group, Inc. for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9423+0.528 * 0.9288+0.404 * 0.9998+0.892 * 1.0181+0.115 * 0.8867
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0712+4.679 * -0.0055-0.327 * 0.9446
=-2.59

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $1,234 Mil.
Revenue was 1566.711 + 1558.055 + 1599.385 + 1732.91 = $6,457 Mil.
Gross Profit was 222.229 + 219.635 + 215.211 + 228.283 = $885 Mil.
Total Current Assets was $1,927 Mil.
Total Assets was $3,435 Mil.
Property, Plant and Equipment(Net PPE) was $122 Mil.
Depreciation, Depletion and Amortization(DDA) was $76 Mil.
Selling, General & Admin. Expense(SGA) was $628 Mil.
Total Current Liabilities was $1,247 Mil.
Long-Term Debt was $321 Mil.
Net Income was 45.024 + 39.913 + 41.261 + 45.921 = $172 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 69.354 + 63.956 + -24.316 + 82.022 = $191 Mil.
Accounts Receivable was $1,286 Mil.
Revenue was 1605.315 + 1556.753 + 1568.401 + 1611.881 = $6,342 Mil.
Gross Profit was 206.562 + 181.535 + 191.138 + 228.449 = $808 Mil.
Total Current Assets was $1,968 Mil.
Total Assets was $3,507 Mil.
Property, Plant and Equipment(Net PPE) was $123 Mil.
Depreciation, Depletion and Amortization(DDA) was $63 Mil.
Selling, General & Admin. Expense(SGA) was $576 Mil.
Total Current Liabilities was $1,292 Mil.
Long-Term Debt was $403 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1233.916 / 6457.061) / (1286.237 / 6342.35)
=0.19109561 / 0.20280133
=0.9423

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(219.635 / 6342.35) / (222.229 / 6457.061)
=0.12734775 / 0.1371147
=0.9288

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (1926.67 + 122.24) / 3434.667) / (1 - (1968.486 + 123.138) / 3506.759)
=0.40346182 / 0.40354498
=0.9998

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=6457.061 / 6342.35
=1.0181

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(63.277 / (63.277 + 123.138)) / (75.822 / (75.822 + 122.24))
=0.33944157 / 0.38281952
=0.8867

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(627.756 / 6457.061) / (575.636 / 6342.35)
=0.09722008 / 0.09076068
=1.0712

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((321.222 + 1247.13) / 3434.667) / ((403.195 + 1292.016) / 3506.759)
=0.45662418 / 0.48341246
=0.9446

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(172.119 - 0 - 191.016) / 3434.667
=-0.0055

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

EMCOR Group, Inc. has a M-score of -2.59 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

EMCOR Group, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.01890.99711.1930.98090.76890.92951.180.94110.90991.0265
GMI 1.12510.89280.93730.95040.90740.87891.04021.09321.02911.0028
AQI 0.97591.04250.92891.65481.02541.00780.81451.29890.94051.3385
SGI 1.04390.97761.06721.20921.14480.81760.87461.15691.13061.0111
DEPI 0.89710.92051.13910.92870.92711.00631.03380.92821.00780.9724
SGAI 0.87791.05731.00650.94691.0121.14030.99430.94850.94951.0509
LVGI 0.97470.91920.98411.04630.93111.04370.85310.98050.94681.0112
TATA -0.0083-0.0442-0.0601-0.0814-0.0504-0.0665-0.0596-0.0062-0.0122-0.0076
M-score -2.39-2.74-2.57-2.47-2.83-3.12-2.71-2.25-2.49-2.36

EMCOR Group, Inc. Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.85080.9630.90990.98411.04630.99791.01910.98050.9090.9423
GMI 1.08171.05471.02911.00511.00010.99491.01691.00040.94710.9288
AQI 0.94890.92560.94050.94370.92661.29551.33851.32391.36420.9998
SGI 1.19371.15871.13061.08321.0351.01431.01841.01851.0241.0181
DEPI 0.91851.00321.00780.96810.98851.00070.97240.94550.91560.8867
SGAI 0.96140.95850.94950.96010.98421.02321.05471.05831.06951.0712
LVGI 0.95570.98030.94680.93620.96771.03041.01121.02020.98060.9446
TATA 0.00180.001-0.01220.009-0.0018-0.0243-0.0076-0.0252-0.0259-0.0055
M-score -2.40-2.36-2.49-2.37-2.43-2.48-2.35-2.49-2.56-2.59
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